The Stupid Stupid Press

The recent House Tax Bill eliminates the ability of Grad students to not pay tax on a Teaching or Research Assistant-ship. Namely it means that they must pay tax on $50,000 or more of money never received. Well they will destroy America as we know it. Perhaps that was the intent of the Republicans, I leave that to them. But Forbes has a writer who declares:

On the chopping block in House Republicans’ bill is section 117(d) of the Internal Revenue Code, which exempts qualified tuition waivers from taxation. Many graduate students work as teaching or research assistance while completing their studies; universities often waive their tuition and provide a small living stipend as compensation. The House plan would treat these tuition waivers as taxable income, which graduate students fear could lead to annual tax hikes of several thousand dollars. Anxiety among graduate students and those considering graduate education is understandable. But what the narrative around this provision has missed is that the House bill does not touch another provision of the tax code: section 117(a). This section provides that scholarships used to pay tuition and fees are not considered taxable income. The catch is that universities which provide these scholarships cannot stipulate that students work as teaching or research assistants as a condition of receiving them. This is the main difference between scholarships and qualified tuition waivers: universities can require students to work as a condition of receiving the latter, but not the former.
Under current law, both scholarships and tuition waivers are not taxable. But the House bill draws a distinction between the two. Under the proposal, universities can still reduce their students’ tuition bills without incurring tax consequences. However, if graduate students work as teaching or research assistants as a condition of getting that tuition help, then the amount of tuition reduction would be considered taxable income. Universities that wish to avoid saddling their graduate students with large tax bills therefore have an easy way out. They can reclassify their qualified tuition waivers as scholarships...

 Well not really. You see as a RA the cost is charged to the research grant, usually a Government contract and thus is netted to zero for the University. As a Scholarship it is not netted against the grant and thus comes out of the endowments or other similar funds. Perhaps for a TA this would work but there are fewer TAs and more RAs.

So why did this brain child of American reportage get this? It is a secondary but key effect. It reflects the overall limited scope of recent American education, i my opinion, as exemplified in my opinion by this piece.

The main question is; who put this in the Tax Bill? Now Congress never really writes anything, Lobbyists do. So follow the money. Who did this? That should be the job of a reporter, not to try to act smart by reaching a putative false conclusion. I have no answer here but someone does.